Redefine and Lehman entered into a joint venture last year to construct
a mixed-use development. The development site, called Annandale, consisted
of 70ha in Richmond, about 3km from the mixed-use precinct Century City
in Cape Town.

Mike Flax, an executive director of Madison Property Fund Managers,
which is the asset management company of Redefine, said yesterday neither
Lehman nor Redefine would suffer any material losses should Lehman pull
out.

Redefine owned 25% and Lehman Brothers held 75% of the company that
had been set up to own and develop the site, said Flax.

The development would cost Redefine about R1,2bn.

He said Redefine had not committed any finances as yet to purchasing
the land, and a new partner would be brought on board in the event of
Lehman pulling out.

He said Madison would be forfeiting only future development fees on
the project should the project be discontinued.

Flax said it was "business as usual" at the Redefine offices
and the project had not been halted. They were still communicating with
Lehman , he said.

According to Reuters, Lehman is a major player in global real estate,
with commercial property interests worth $32,6bn.

Lehman entered the South African property market for the first time
last year through its tie-up with Redefine, SA's fourth-biggest listed
property fund with a market capitalisation of R5,6bn.

Lehman, one of Wall Street's biggest investment banks, has filed for
bankruptcy protection as the US subprime mortgage crisis continues.